Partnering with Polymetal: from IPOs to Compliance Audits for ongoing reporting

Since 2003 to the present, SRK has partnered with JSC Polymetal in its annual declarations of Mineral Resources and Ore Reserves. The declarations meet the terms and definitions in the 2004 Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore reserves – the JORC Code, an internationally recognised reporting code as defined by the Combined Reserves International Reporting Standards Committee (CRIRSCO).

Today, Polymetal is a public holding company listed on the London Stock Exchange (SRK Mineral Expert’s Report 2006), the Russian Trading System Stock Exchange and MICEX. The company operates and manages extensive mineral properties located in the Urals, Siberian and Far Eastern Federal Districts of the Russian Federation. These mineral properties comprise 30+ separate licences with a total area exceeding 7,100km2 covering the development spectrum from advanced staged exploration, to developing and mature operating mines. In the 9-month period ending 30 September, the company processed 3.2Mt of ore to produce 12.8Moz of silver and 0.2Moz of gold. By January 2009, the company reported total Ore Reserves of 390Moz silver and 5.2Moz gold contained within 65.5Mt of ore grading 185.5g/t silver and 2.5g/t gold.

On an annual basis, a significant (2009: 80%) portion of the Ore Reserve declaration in Polymetal’s Annual report supported by the Compliance Audits were completed by SRK from consulting practices in Europe and the Russian Federation. The process SRK follows combines annual desktop studies and sample site visits completed on a three-year rolling basis. To ensure material and transparent disclosure, SRK reviews the entire discipline spectrum from exploration through geology, resource estimation, mining, metallurgy and environmental to mineral economics. This process is greatly aided by the company’s established twin reporting system, specifically developed for computerised estimation and modern pit optimisation techniques, as well as manual techniques that comply with local regulatory reporting requirements.

SRK recognises that organic development and acquisition continues to fuel the growth of companies operating in the Russian Federation and the broader Commonwealth of Independent States (CIS). This growth coupled with the widespread geographic location of mining and exploration properties within these companies and the continued need for access to global debt and equity capital markets, places increasing demands on in-house technical resources and external consultants. To meet this demand SRK continues to draw on its global resources and local expertise to:
  • Establish further CIS regional practices
  • Develop Mineral Resource and Ore Reserve management systems/protocols tailored to the needs of local and international regulatory requirements
  • Play a direct role in the various international initiatives to align state approved reserve reporting systems with the CRIRSCO template
Iestyn Humphreys: ihumphreys@srk.co.uk



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